What is bad credit and how can you fix it?
Your credit history shows how reliable you are at repaying the money that you borrow. If you apply for a credit card or loan, the provider will look at your credit history. They will assess your reliability and can refuse an application if they think there is a risk that you might not pay them back. This can make it difficult to get things like phone and broadband contracts or a mortgage. Even if you have never had to borrow money from a creditor before, you will have poor credit. It is difficult for lenders to tell how responsible you are if you have no track record at all. The way to get around this, and to repair bad credit due to irresponsible lending, is to build your credit score up over time.
What is a “bad credit” credit card?
Cards for those with bad credit will have a smaller limit and make it easier to pay them off through more affordable minimum monthly repayments. The lender is more likely to approve you for one of these cards than a regular credit card. These cards usually don’t have annual fees, either. When you use them to build your credit score back up, you could get a higher limit and lower interest rates in the future. The downside is that they usually have higher interest rates to protect the lenders. You could end up reducing your credit score further if you fail to make the repayments. If you are trying to find a “bad credit” credit card, you can look through the top ten credit cards for bad credit below.
1) TESCO BANK FOUNDATION CREDIT CARD
The Foundation card is named this because it is aimed at those starting from the bottom with credit. It has higher minimum monthly repayments, but this helps you to clear the balance much faster and avoid paying more interest.
- Credit Limit: £250 – £1,500
- Representative APR: 27.5%
- Minimum Repayment: £25
- Benefits: optional limit increases for successful account management
- Bonuses: collect Tesco Clubcard points, access Noddle Premium services
2) VANQUIS CHROME CREDIT CARD
The Chrome credit card has a lower limit but also a lower interest rate. You cannot apply for the Chrome card if you already have a credit card with Vanquis, and unfortunately, there isn’t an eligibility check available before you apply.
- Credit Limit: £250 – £1,000
- Representative APR: 24.7%
- Minimum Repayment: 3% of the balance + interest or £10 (whichever is greater)
- Benefits: lowest APR from Vanquis, possible increases with reviews every 5 months
- Bonuses: build your credit limit over time up to £4,000
3) MASTERCARD AQUA ADVANCE CREDIT CARD
The Aqua Advance card does not offer a 0% period, charging a massive 34.9% interest from the start. However, it offers incentives if you pay on time and stay below your limit. They may accept defaults, CCJs, and bankruptcies.
- Credit Limit: £250 – £1,200
- Representative APR: 34.9%
- Minimum Repayment: £5 or 1% of balance + interest (whichever is greater)
- Benefits: reduce APR by 5% a year (down to 19.9%)
- Bonuses: £20 Amazon voucher if you meet the criteria for the first 2 months
4) MASTERCARD AQUA REWARD CREDIT CARD
Similar to the Advance, there is also the Aqua Reward card. As its name suggests, this card offers more rewards for spending – but don’t use that as an incentive to shop. The downside is that you can’t reduce the high interest rate.
- Credit Limit: £250 – £1,200
- Representative APR: 34.9%
- Minimum Repayment: £5 or 1% of balance + interest (whichever is greater)
- Benefits: free credit report alerts, no charge for overseas spending
- Bonuses: 0.5% cashback (up to £100 a year)
5) BARCLAYS BARCLAYCARD FORWARD CREDIT CARD
This is the Barclaycard offering for first-time credit card users or anyone with a poor credit history. You must be in employment earning at least £3,000 a year and not have another Barclaycard or IVA, CCJ, or bankruptcy to qualify.
- Credit Limit: £50 – £1,200
- Representative APR: 34.9%
- Minimum Repayment: £5 or 2.25% of the main balance (whichever is greater)
- Benefits: 0% interest on purchases for the first 3 months, text alerts
- Bonuses: 5% – 10% back on thousands of events with Barclaycard Entertainment
6) ASDA CASHBACK START CREDIT CARD
Asda’s Cashback Start credit card is good for beginners, and anyone wanting to earn a little extra while they build their credit score. To be eligible you must have an annual income of £10,000+ (no unemployment benefit claims).
- Credit Limit: £100 – £1,200
- Representative APR: 34.9%
- Minimum Repayment: 1% of the balance + interest or £5 (whichever is greater)
- Benefits: 0% interest for 6 months on George.com (when spending £200)
- Bonuses: 0.2% – 1% cashback (in Asda vouchers)
7) TANDEM JOURNEY CREDIT CARD
The Tandem Journey card is a good credit card for people who travel. It can help you to build your credit history, but you must earn £6,000 a year to be eligible. The APR is variable so even if they accept you it may be at a higher rate.
- Credit Limit: £150 – £1,200
- Representative APR: 24.9%
- Minimum Repayment: £5 or 1% of the remaining balance + fees (whichever is higher)
- Benefits: purchase protection over £100, can change your payment date
- Bonuses: no fees for foreign transactions
8) MASTERCARD MARBLES CREDIT CARD
The Marbles credit card is basic, but it is available for first-time borrowers (meaning that it does not require credit history). Like other cards of its type, it has no annual fee and you can manage it online and through a mobile app.
- Credit Limit: £100 – £1,200
- Representative APR: 34.9%
- Minimum Repayment: £5 or 1% of balance + interest (whichever is greater)
- Benefits: 0% interest on spending for 5 months, choose your monthly repayment date
- Bonuses: credit limit review after 3 months (potential increase)
9) CAPITAL ONE LUMA CREDIT CARD
The Luma card is designed for people trying to rebuild their credit rather than people who are just starting out as borrowers. However, you could still be eligible even if you are new to the credit world or if you have rating issues.
- Credit Limit: £200 – £1,500
- Representative APR: 35.9%
- Minimum Repayment: at least 1% + interest
- Benefits: 0% charge on purchases for 3 months, add 3 more card-holders
- Bonuses: exclusive limited-time offers with Luma Rewards
10) CAPITAL ONE THINKMONEY CREDIT CARD
This credit card offers a slightly higher maximum credit limit, but it also comes with a higher interest rate. It is not a card for people who have never borrowed credit before, as it requires at least a brief history of credit management.
- Credit Limit: £200 – £1,500
- Representative APR: 39.9%
- Minimum Repayment: at least 3% + interest
- Benefits: online account management, contactless transactions (up to £30)
- Bonuses: a flat interest rate for transactions, can add 3 additional cardholders
